If you want a vibrant media business, it doesn’t come for free – somebody has to pay for this. And there are two major sources of funding media content – consumers (for example, subscriber fees) and marketers (through advertising). But the FCC’s new privacy regulations, which focus only on consumer information retained by internet service providers (ISPs), raise very serious concerns for the advertising pillar. Given the reluctance of many consumers to pay for content in the digital world, this threat to digital advertising – called “unprecedented, misguided and very harmful” by the Association of National Advertisers, is even more troublesome.

When I was a young, modestly paid staffer on Capitol Hill, there was nothing better than a free lunch. But it pretty quickly became evident that nothing was quite as “free” as it seemed (even if only meant listening to some annoying windbag). Unfortunately, based on their new privacy regulations, the Federal Communications Commission (just a short trip down Independence Avenue from Capitol Hill) hasn’t applied my long-ago lesson too well. They seem to see a glorious, free lunch-filled future where consumers pay less for content and see fewer ads, cable and content companies make less money, marketers advertise their products less, and yet everyone wins. Sorry, Alice, there is no Wonderland.

I’m no laissez-faire purist on this. In the age of Wikileaks and thefts of consumer information from financial institutions, telecommunications companies and email server providers, safeguarding privacy is critical for the federal government and the FCC. And the FCC’s regulations have several worthy elements. ISPs must follow explicit rules for notifying consumers about the collection, use and sharing of information about them (including the offering of financial incentives for consumers who permit sharing). ISPs can’t refuse to serve customers that don’t consent to the use and sharing of their information. Customers must be notified when breaches of their information occur. But dangers await.

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Quite clearly for the advertising industry, the most troublesome part of the of the FCC’s rule is the mandate that ISPs obtain the consumer’s “opt-in” to permit use or sharing of “sensitive” consumer information. As Dan Jaffe, the ANA’s long-time head of government relations, told me, the characterization of literally all information on consumer browsing and app history as “sensitive” (with no differentiation from more truly sensitive sources such as health and financial information) will “literally dry up the data pool for advertisers.” It makes almost impossible the widespread implementation of advertising that is more relevant to the consumer based on their own demonstrated preferences and interests, which is the key value proposition for advertisers.

My overarching concern about this new FCC regulation is the lack of context. I was recently at a discussion with an FCC commissioner who spoke passionately and persuasively about the need for a coordinated approach to privacy by the large number of federal departments and agencies that share responsibility for protecting consumer privacy. Yet this regulation, despite referencing the work of the Federal Trade Commission, completely ignores the need for such coordination and context.

Where do you do most of your internet browsing? Probably through Google and Facebook, which, according to the Interactive Advertising Bureau, already control 64% of all digital advertising (and 75% in the fourth quarter of 2015). Yet because the FCC lacks jurisdiction over those companies, these new regulations apply only to your browsing history in possession of ISPs. In fairness, Facebook and Google have not come out in support of these unbalanced regulations, but their impact will be to heavily tilt the advertising playing field even more towards Facebook and Google, who can use and share “sensitive” information on their sites that their ISP competitors cannot.

Beyond the lack of coordination with their federal agency counterparts, the FCC’s action ignores the context of so many threats to the infrastructure of the content business today. Consumers have become disenchanted with the size and particularly the price of the venerable cable “bundle.” And in response, the industry is creating a variety of skinny bundles which may threaten it further. According to a recent report from respected industry analyst firm MoffettNathanson, penetration rates for new OTT services such as those from DISH and Hulu (costing a fraction of traditional cable and satellite) fall as monthly subscriber fees increase (not a shocker to my Media Economics students). Less money coming into the industry means less coming out for content, no matter how you calculate it.

It’s not like the consumer on their own is fleeing to advertising as an antidote to subscriber fees. The use of readily-available ad blocking software is growing dramatically, from almost 70 million Americans in 2016 (up 34% from 2015) to an expected 86 million in 2017 (a 24% increase). This is the consumer taking their media activity into their own hands. In response, the industry is compelled to create more personalized, attention-worthy advertising to avoid this, but this is precisely what the FCC will make far more difficult.

And in the midst of external threats to the traditional content world for both consumer and advertising funding sources, the FCC has sought to accelerate the chaos. In the last year, we’ve seen new regulations or proposed regulations on set-top boxes, limitations on the flexibility of business arrangements for internet services (through net neutrality), and now the hit to personalized advertising. But other than sending more and more advertisers into the arms of Facebook and Google, I keep wondering what the vision is for the future funding of the content business. If you conduct a survey of consumers and ask them if they’d like a free lunch, I’d guess that most if not all would say yes. But be careful – there is in fact no such thing.

Howard advises leaders of major media and marketing companies on managing the dynamically changing media business; follow him on Twitter, Facebook, and LinkedIn.